Shares of real estate company Lewinsky Ofer It is traded today (Monday) on the Tel Aviv Stock Exchange with a decrease of about 12%, after the company revealed a letter sent to it in June this year from the Kiryat Malachi municipality, but according to it was received only last week. The letter sheds further light on the state of the evacuation-construction project in the city, which the company is leading, after it has recently completed raising capital and debt.
Levinsky Ofer, controlled by Ofer (Baruch Ofir) Arbiv and Yossi Levinsky, is engaged in construction and real estate entrepreneurship. .
In the first nine months of 2021, Lewinsky Ofer recorded a 5.1% increase in income from the sale of apartments, as well as a 76.7% increase in the net and total loss, to NIS 4.8 million. According to the company, the letter was published on Monday at the request of the Securities Authority, along with the company’s clarification regarding the course of events.
The story began on June 16, 2021, when Levinsky Ofer reported that “an agreement was signed between the company and the Kiryat Malachi municipality to promote an evacuation-construction project in the Kibbutz Galuyot complex in the city, in block 2405, block 2407 plots 9-11 and 51 and block 2471 plot 182. The company There are construction eviction agreements with most of the owners of apartments in part of the complex located in block 2405, where there are 503 apartments. “
According to the report at the time, it was agreed that “the company will act, as a leading entrepreneur, together with the other developers in the complex, to promote the master plan for the project funded by the developers, without waiting for funding from the Urban Renewal Authority.” Housing units, in place of the Urban Renewal Authority and / or the local authority.
“The lead developer, in collaboration with the municipality, will do everything in their power to advance the planning process as quickly as possible, while removing barriers as much as possible, given the scope of the project and its importance to the city.
“The lead developer will appoint a project manager who will coordinate and coordinate what is required to promote the project and meet the schedule, and will provide monthly reports to all parties involved in the project,” it added. The municipality will ensure the allocation of the remaining rights, and will work with the relevant parties, in a way that will bring the ratio of apartments in the project to 1: 9 in complementary land in the “Timurim” complex, marketed by the municipality and owned by Rami, and / or any other complex that can be allocated for the project. .
“If the project is implemented, the estimated number of apartments that the company will build as part of the project, together with the apartments that will be built on supplementary land, and includes about 503 exchange apartments for tenants, is about 4,500 apartments,” the same report said on June 16.
“Complementary land – only through RMI”
Today, as mentioned, Lewinsky Ofer reported that last week (December 22, 2021) “the company received an email from the city engineer of Kiryat Malachi, to which was attached a letter dated June 29, 2121, regarding the company’s Kiryat Malachi project.”
The letter, which was signed by the city engineer Noam Welfare and Mayor Eliyahu Zohar, as well as the explanatory notes regarding it, were published as stated at the request of the Securities Authority. The letter states, among other things, that “the municipality considers it very important to carry out evacuation-construction projects in the city, and will cooperate with the city’s residents and developers on their behalf to bring about the development of new neighborhoods in the city.” Evacuation of construction in the city. “
However, a letter sent to Lewinsky Ofer also states that “as you know, the key to the success of construction clearance projects is conditional on supplementary land, and such can only be through the Israel Land Authority (RMI), which will determine in time the manner of land allocation. Complementary.
“Beyond the above, the municipality has not signed with Levinsky Ofer Ltd. or any other developer any agreement or obligation in the matter, and it can not even be a party to such a contract, since it does not own the supplementary land.” According to Levinsky Ofer, also “The letter from the Kiryat Malachi municipality dated 29.6.2021 was received by the company, as stated, only on 22.12.2021, and the company did not know of its existence before that date.”
Beyond that, the management of Lewinsky Ofer emphasizes that “at the time of publication of the shelf report, the company did not know about the letter dated 29.6.2021. Here the issue becomes more complicated, since between the two reports the company made two issues, one of shares and one of bonds.
On July 22, Lewinsky Ofer raised NIS 21 million by issuing shares, while on August 23, the company completed raising NIS 92.6 million by issuing Series D bonds. The controlling shareholders also participated in the issuance of the shares, which flowed to Lewinsky Ofer an amount of NIS 11.2 million out of the total raising.
According to the company, both in the shelf prospectus published prior to the bond issue and in the financial statements for the summary of the second and third quarters of this year, it was stated that “for the construction will require, among other things, a ‘roof agreement’ or other arrangement “As of the date of these reports, the supplementary land has not yet been determined and no agreement has been signed between the company and the Authority.”
In a report published today, the management of Lewinsky Ofer added that the company continues to operate in cooperation with the Kiryat Malachi Municipality. Following the meeting held by the company on December 9, 2121 with the Forum of the General Manager of the Municipality of Kiryat Malachi, which includes the mayor, the company intends to submit to the local committee the master plan for the Kibbutz Galuyot complex by December 31, 2121.
High school builders were also quick to build enthusiasm
The field of evacuation Construction of residential buildings in Israel brought with it this year a partial and unclear report from a company High school builders , Controlled by Ami (Amram) Peretz. On September 13, the high school builders reported to the stock exchange that it was promoting an evacuation-construction project on the streets of Harama, Galilee and the Judean Mountains in Ganei Tikva, in which 18 buildings are expected to be evacuated, including 408 apartments and commercial areas.
The company added at the time that “according to the company’s estimates and subject to obtaining the required permits, about 1,300 apartments, commercial areas and public buildings will be built in their place. According to the company’s management, and according to calculations made by it, .
In response, Ganei Tikva Council Chairman Lizzie Delricha was interviewed on the BizPortal website, claiming that the project violates the Ganei Tikva master plan, which does not allow construction to be evacuated there but only TMA 38. The next day, the high school builders issued a clarification notice, including Noted that “in order to carry out the project, according to the currently accepted urban renewal norms (demolition and reconstruction), a plan under the authority of the District Planning and Building Committee – Central District, which will amend the existing plan that does not currently allow demolition and construction project, will be required. re”.
The high school builders further clarified that “the company intends to promote such a plan according to the milestones set forth in the evacuation-construction agreement with the rights holders in the project, when at the time required by law, it will present it to the local committee.” The company emphasized that up to the date of the same report, binding eviction-construction agreements had been signed with rights holders in 104 apartments, which constitute more than 25% of the apartments in the project.
Company response
Levinsky Ofer responded: “The company wants to clarify the facts as follows: There is a signed document between the company and the Kiryat Malachi municipality regarding the Kibbutz Galuyot complex, where the company’s Kiryat Malachi project is to be built, among others. The document was prepared by the municipality and signed by the mayor 6.5.2021 At the request of the municipality, the company approved the document and signed it on 15.6.2021. The company reported the summary documented in the document signed in the immediate report dated 16.6.2021.
“Also, the letter from the Kiryat Malachi Municipality bearing the date of 29.6.2021 described in the company’s immediate report dated 26.12.2021 was received by the company only on 22.12.2021. The said letter was received with an email from the city engineer dated 22.12.2021, That according to what the director of the mayor’s office received an incorrect email address, and it is possible that the letter dated 29.6.2021 did not arrive, and therefore he was asked by the mayor to send it again.
“The company continues to operate in cooperation with the Kiryat Malachi Municipality, and as a result the master plan for Kibbutz Galuyot is planned to be submitted to the local committee until 31.12.2021, after it was presented at a meeting held by the company on 9.12.2021 with the participation of the mayor and city engineer and planning team. By the competent authorities in the municipality. ”